In today's interconnected world, businesses constantly seek to expand their horizons internationally, opening doors to exciting new opportunities.
With the world more connected than ever, your business can cast a wider net and tap into talent and markets across the globe, driving business and growth.
However, undertaking cross-border hiring and operations requires navigating the complexity of local laws, taxes, and compliance. This is where Global Employer of Record (EOR) services shine.
This comprehensive guide will help you understand this uncharted territory and help you navigate to find the right Global EOR for your business.
What is a Global Employer of Record (EOR) Service?
A Global EOR is the legal employer of record for your overseas employees.
Essentially, the EOR handles all employer legal, HR, and payroll responsibilities in the countries where you hire remote staff or set up new offices.
This removes the burden of establishing foreign legal entities while empowering you to hire top talent globally.
With an EOR partner, you can test new markets and expand seamlessly without the costs or complexities of setting up subsidiaries abroad.
Navigating Global Employment Complexities
Employing overseas workers is quite complex, with multiple layers of intricacies — labour laws, tax codes, compliance requirements, etc.
Some common pain points for businesses include:
- Understanding localised payroll systems, income taxes and social security obligations
- Navigating unique visa regulations and immigration policies by country
- Providing compliant employee benefit plans, including healthcare, insurance, retirement accounts and leave policies
- Adhering to rigid local employment laws around hiring, terminations, and employee rights
- Conforming with national data privacy regulations and HR record-keeping
- Managing cross-border compensation, equity plans, and remote workforce policies
As your business grows into multiple countries, these concerns often multiply into more complex ones.
Key Benefits of Using Global EOR Services
Keeping pace with the regulatory environment in every market becomes excessively burdensome, and acting without expertise exposes you to substantial legal and financial risks.
This is where the value of an EOR partner shines through.
Accelerated Global Expansion
Launching new offices or subsidiaries overseas can be time-intensive and cost-prohibitive for many companies.
But with EORs, you can rapidly expand globally and hire without these hurdles. You can quickly deploy talent in new regions and be up and running in weeks rather than months. Some EOR’s like Teamed, offer 24/5 onboarding services to ensure a smooth and rapid expansion process.
Access to Global Talent and Skilled Workers
Make sure to expand your talent search beyond single geography. EOR services let you access the world's best and brightest, unconstrained by local immigration laws.
While you hire, an EOR can handle the necessary paperwork permits to employ foreign staff legally.
Reduced Legal, Tax and HR Administration
EOR services minimise the administrative burdens of international hiring and HR management.
Your EOR partner undertakes payroll, tax filings, legal compliance, employment contracts, and other complex requirements in full adherence to local laws.
Mitigated Risk and Legal Liability
Using a Global EOR reduces operating risks, as they assume primary employer responsibilities and liability in foreign regions.
On the other hand, you can avoid expensive missteps around unknown regulations and gain peace of mind knowing you aren't exposed legally.
Local HR Support and Expertise
EORs have specialised in-country teams familiar with regional employment nuances.
They can provide localised HR services and expertise vital for smooth overseas hiring, enabling you to avoid cultural blunders that could damage your brand. This is where dedicated in-country teams ensure a personalised and culturally sensitive approach. - You can find more about the countries we can support you with by booking a call with us!
The EOR model also offers unmatched flexibility to deploy talent swiftly across geographies, allowing you to quickly ramp up or downsize as business needs change, pivoting faster than competitors. This agility gives you an edge that helps you beat your competitors.
How Global EOR Works
Utilising an Employer of Record (EOR) service globally streamlines the process of onboarding and managing overseas employees.
Here's an overview of how global EOR works:
Step-by-Step Process of Onboarding Employees Through EOR
The key steps involved in onboarding new hires through an EOR include the following:
- Selecting the countries you wish to hire remote staff and expand operations into. Your EOR provider can advise on the best regions based on your business needs.
- Working with your EOR's in-country teams to source suitable candidates that match your hiring criteria.
- Extending job offers to chosen candidates and having them sign the EOR's standardised employment contract.
- Your EOR secures applicable paperwork, permits, visa sponsorships, etc. and handles the heavy building.
- On the start date, the EOR formally onboard new hires as the legal employer, including payroll setup, taxes, and more.
- Day-to-day management of international employees will also be facilitated by your EOR but overseen by your company.
EOR Responsibilities vs Client Responsibilities
Since EOR is your company's legal representative in a particular region, it also takes a share of your responsibilities.
Global EOR services take on the bulk of legal and compliance responsibilities involved in international hiring.
Key EOR responsibilities include:
- Serving as the legal employer of record in foreign countries
- Managing in-country payroll, taxes, and social security contributions
- Securing work permits and managing immigration/visa requirements
- Ensuring adherence to local labour laws and employment regulations
- Providing compliant HR services, benefits, insurance, leaves etc.
- Handling employee terminations and severance as per local laws
On the other hand, you, a.k.a the Client, are responsible for duties directly related to operations and workforce management:
- Defining hiring needs and criteria for screening candidates
- Day-to-day management and oversight of remote employees
- Providing technology, infrastructure, and tools for employees
- Managing employee training, evaluation, talent development
- Dictating compensation levels and equity awards
Ensuring Seamless HR and Payroll Processes with EOR
At the end of the day, running an operation isn't enough. It has to be smooth and seamless.
With the right technology stack and global expertise, EORs can deliver a seamless HR and payroll experience:
- EOR's online HR platform centralises employee records, payroll, taxes, etc.
- HR teams have self-service access to real-time reporting on the global workforce.
- Employees are onboarded swiftly with digital tools and access payroll details online.
- Global payroll is facilitated through a single payment transfer to the EOR.
- In-country teams handle localised payroll payments, filings and employment compliance.
Teamed's streamlined and cloud based EOR solution ensures an efficient and seamless management of a globally distributed team across geographic borders.
Choosing the Right EOR Partner
Multiple factors come into play when choosing the best EOR partner to ensure your business is secure and running smoothly.
Here are the checkboxes you need to tick before hiring one:
Expertise and Experience
Assess the provider's depth of expertise and years of experience managing international employer obligations, payroll, taxes, and compliance across various regions.
- Extensive track record over many years
- Demonstrated success through client case studies
- Seasoned in-country specialists worldwide
- Knowledge of nuanced regional differences and regulations
Analyse their footprint and capabilities to support your current and future target markets:
- Seamless support in your priority countries and regions
- Localised HR services and legal guidance
- Ability to scale up as you expand to new markets
Customisation and Flexibility
Seek an EOR partner that provides tailored solutions aligned to your needs:
- Custom-built offerings for your industry and business model
- Flexibility in structuring employment terms
- Integration with your existing HR software and systems
- Scalable services as your international presence grows
Get Started with Global EOR Services
Choosing a partner with the optimal mix of expertise, global reach, and customisations directly empowers your international success.
Teamed Democratising Employment
“Our need to convert two contractors to full-time employees in Spain was managed effortlessly through the Teamed platform and their accompanying services. What would have been a complex, costly and long drawn out process was made simple, and dare I say a pleasurable experience.” – Rachel Blezard, Head of People Operations, SpotQA.
For more streamlined global hiring and growth, Teamed is an end-to-end EOR solution, simplifying international employment through tech-enabled services. We can expertly manage your worldwide expansion and compliance needs while you can grow your business in peace.
FAQs About Global Employer of Record Services
1. What is a Global Employer of Record (EOR) service?
An EOR is a provider that acts as the legal employer of staff hired overseas to alleviate your company's entity setup and compliance obligations in foreign countries.
2. Why do businesses need Global EOR services?
To hire abroad without establishing foreign legal entities or navigating complex localised HR, legal and tax regulations in other countries.
3. What are the key benefits of using Global EOR services?
Accelerated global expansion, access to worldwide talent, reduced HR administration, legal and compliance risk mitigation, in-country expertise, and increased operational flexibility.
4. How does the EOR model work?
An EOR becomes the official employer of record for your overseas staff, handling all localised employment compliance, payroll, benefits, taxes, and HR functions end-to-end.
5. Can EOR services be customised for different countries?
Yes. Leading EORs tailor services to meet individual countries' specific employment laws, HR practices, and payroll needs.
6. What risks are there with overseas hiring without an EOR?
Non-compliance with local regulations, tax penalties, ineffective workforce management, and increased legal liability in foreign jurisdictions.
7. Can Global EOR services be used for short-term projects?
Yes, Global EOR services can be utilised for short-term projects to hire contractors.
8. Is EOR suitable for startups and small businesses?
Yes, EORs are suitable for growing startups and small businesses where they want to hire remote full time employees and contractors.
Ready to Succeed with Global Hiring?
Teamed is here to help you navigate the complexities of international employment. Book a chat with us today and let's explore how we can empower your global hiring success. Contact Us Now